This employer doesn’t have to abide by the National Pensions Law, join a private health-care plan or apply for work permits.
This employer has special exemptions carved out in business regulations, when it’s not operating according to its own separate guidelines.
When a law does apply, this employer routinely ignores it as a mere inconvenience. This employer doesn’t worry about particular divisions bleeding millions of dollars per year, and rather than downsizing its workforce, it raises prices on the consumers of its monopolistic services.
If this employer were Caribbean Utilities Company, Dart Realty (Cayman) Ltd., or the Kirk Group of Companies, people would take to the streets demanding that government sever its contracts, plug the loopholes in the law and perhaps bring up principals on substantial charges. They’d be armed with valid points, too.
Then again, however, we can’t reasonably expect the Cayman government to condemn itself.
Following public outrage over Cayman Islands Complaints Commissioner Nicola Williams’s bombshell announcement that 1,144 businesses owed some $13.7 million in missed pension payments, the government – though it did not take substantive action – did at least make some stern-sounding pronouncements. A review of the private pensions law is promised in 2016.
Amid the private pension uproar, it did not go unnoticed or unmentioned that the government has underfunded its own public servants retirement fund by $166 million. That’s the “unfunded liability” amount, as of January 2011, that the fund will have to make up over 20 years in order to meet its retirees’ pension obligations.
The situation is so dire that actuaries recommended the contribution for the defined benefits part of the plan (for civil servants enrolled in the year 1999 and prior) be increased from 12 percent of a public servant’s salary to 44.23 percent. In the private sector, pension contributions are 10 percent of salaries.
In addition to pledges of relatively handsome pension benefits, the government also offers its employees generous health-care coverage through the public Cayman Islands National Insurance Company. The public health-care benefit has proven so costly that government won’t – and even if it wanted to, probably can’t – provide a current estimate of the program’s unfunded liabilities.
Calculated in 2004 (ancient history in accounting terms), the last actuarial estimate pegged government’s unfunded liability for health-care services at an eye-popping $654 million.
Astronomical long-term debt is one predictably obvious consequence of allowing an organization to spend other people’s money as it pleases with no practical accountability. Legislators have now passed a dramatic overhaul of the country’s Immigration Law, setting a nine-year “rollover” period for foreign workers and revamping the process and criteria for obtaining permanent residency.
Companies are bracing for impacts from the potential en masse departure of some 1,500 workers on Term Limit Exemption Permits. Expatriates are perusing byzantine calculations for glimmers of hope for permanent residency. Career-seeking Caymanians are champing at the bit to apply for vacated positions.
Meanwhile, in the public sector, it’s business as usual. The new Immigration Law, you see, doesn’t apply to government. It’s the latest reminder that, when it comes to the true contrast of “them” and “us” in Cayman, the government is “them” and the rest is “us.”